Cloud services & data centre firm ESDS Software Solution has filed a draft red herring prospectus (DRHP) with the capital markets regulator Sebi to raise funds via an initial public offering (IPO).
The public offer comprises a fresh issue of Rs 322 crore and an offer for sale of 2,15,25,000 equity shares by investors and promoters.
The offer for sale consists of selling 42,31,000 equity shares by investor GEF ESDS Partners LLC, 1,68,60,000 equity shares by South Asia Growth Fund II LP, 34,000 equity shares by South Asia EBT Trust, and 4,00,000 equity shares by Sarla Prakashchandra Somani.
The company said it may consider a further issue of Rs 60 crore of specified securities through a rights issue to existing shareholders, private placement, preferential offer, or any other method, prior to the filing of the red herring prospectus with the ROC. If the said pre-IPO placement is completed, then accordingly the fresh issue size will be reduced.
The net proceeds from the fresh issue will be utilised for purchasing cloud computing equipment for data centers (Rs 155 crore), funding long-term working capital requirements (Rs 75 crore), repaying of debt (Rs 22 crore), and general corporate purposes.
ESDS Software Solution is amongst India's leading managed cloud service and end-to-end multi-cloud requirements providers. It offers cloud computing Infrastructure as a Service (IaaS), and Software as a Service (SaaS), and managed services.
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The company operates the business on an asset-light model, which comprises ownership of computing hardware assets only, thereby allowing quicker scalability and reduced capital cost of operations.
It offers products across diversified industries that include government ministries & companies and corporate entities across sectors such as BFSI, manufacturing, IT and ITES, telecom, real estate, pharmaceuticals, retail and education and in several countries across the APAC region, Europe, Middle East, the Americas, and Africa.
In the financial year ended March 2021, the company reported a profit of Rs 5.48 crore on revenue of Rs 171.93 crore, increasing from the profit of Rs 0.94 crore on revenue of Rs 158.57 crore in FY20, respectively.
Axis Capital and IIFL Securities are the book-running lead managers to the issue.
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